Best Practices in Guardianships and Conservatorships

December 11, 2019 § 2 Comments

The UCCRs impose a heavy duty on attorneys to advise and supervise the client-fiduciary in fiduciary matters, including guardianships and conservatorships. The burden can be so onerous that some cases refer to it as the “yoke of probate.” You can not blithely turn your fiduciary loose to figure it out for himself or herself. You have a duty to the court, the ward, creditors, and, in estates, the beneficiaries or heirs.

Make sure your fiduciary knows what are the do’s and don’ts. Put together an instruction sheet and have your client sign a copy to keep in your file for your protection.

There is a reason that UCCR 6.01 requires every fiduciary to have an attorney (unless excused). It’s because the attorney is the arm of the court who is responsible to supervise the fiduciary and make sure everything is being done properly. As you have heard many times before, if you find that too burdensome, simply refuse to handle fiduciary matters.

Some GAP Act considerations:

• § 93-20-125, MCA, deals with coverage of the GAP Act. All cases commenced on or after January 1, 2010, proceed under the GAP Act. “A civil action is commenced by filing a complaint with the court.” MRCP 3(a). So when you file your complaint to open the guardianship or conservatorship will determine coverage. Cases that were commenced before January 1, 2020, are covered by the GAP act unless you move the court for a finding the “application of a particular provision of this chapter would substantially interfere with the effective conduct of the proceedings or prejudice the rights of the parties …” and the court finds that the particular provision does not apply.
• MRCP 18(a) specifically states that “A party asserting a claim to relief as an original claim, counter-claim, cross-claim, or third-party claim, may join, either as independent or as alternate claims, as many claims as he has against an opposing party.” Some people have raised the question whether the GAP Act allows a combined guardianship/conservatorship action. The GAP Act is silent on the point, yes. But MRCP speaks loudly that you can. And the GAP Act expressly provides at Section 107 that procedures are governed by the MRCP.
• Some people have also questioned whether, if combined actions are allowed under the MRCP, are two filing fees required? Why would they be? They are not now for combined guardianships of the person and estate, which are merely the old (now existing) terms for what under the GAP Act will be guardianship and conservatorship.

• There are some hiccups with MEC adapting to the new nomenclature imposed by the GAP Act. That is being fixed even as this is being written. Our fingers are crossed that the issues will be fixed before January 1, 2020.
• Also to be addressed are technical corrections to the Act to address some concerns that have been raised. This is normal and to be expected. Every statute with the extent of the GAP Act undergoes a similar process.

Some general suggestions …

• Always accompany the fiduciary to the bank or other financial institution to open the conservatorship account. That way you can make sure that the funds are properly deposited into a restricted account, and that the fiduciary does what she is supposed to do.
• Always ask that a duplicate bank statement be sent to you for the conservatorship account. If the bank balks, direct that the bank statement be sent to you and not the fiduciary. Review each bank statement promptly when you receive it to make sure that no unauthorized disbursements are being made. Also, when the next accounting comes due — Voila! — you have a complete set of bank statements.
• Have your secretary or paralegal call the fiduciary every couple of months to inquire how things are going, to remind of upcoming deadlines, and to ensure that the address and telephone info in your file is accurate. This is not only great client relations, it’s one of the best means possible to discover and address problems in their early stages.
• Accompany your fiduciary to inventory that safe deposit box, and, if possible, bring a witness. It seems that there is often someone lurking in the wings ready to allege that there were all sorts of valuable items in there that the fiduciary is not accounting for.
• Do an inventory even when one is not required. Inventory establishes the baseline for accounting. It also can help neutralize the claims of many disgruntled parties claiming an interest. The GAP Act inventory form is exactly what you need to go by.
• GAP Act forms are not only helpful; they also were carefully crafted to include every item you are required to plead or report. Use them. Slavishly using the exact forms is not (yet) required; however, if you prefer to make your own forms, yours should substantially conform to those published.
• As of today, we have no body of law interpreting the GAP Act, but that will surely change over time. Until it does, we can look to court decisions under our former law. MCA §93-13-38 provided that, “All the provisions of the law on the subject of executors and administrators , relating to settlement or disposition of property limitations, notice to creditors … “ , etc. also applied to guardianships and conservatorships. Just in case that principle is found to apply to GAP Act cases, you need to keep in mind that, in an estate, when real property is sold pursuant to a decree of the court, § 91-7-205, MCA, requires that the executor or administrator shall execute a bond equal to the proceeds of the sale of the land. This code section does not apply to a sale by the heirs or devisees in whom title has vested. There is an exception to the requirement of bond. If the time within which all claims of creditors against the estate has expired, the court may waive all or any part of the bond when all the beneficiaries to the proceeds of the sale petition the court to authorize the sale and waive the necessity of a bond. § 91-7-205, MCA. If an executor or administrator fails to give the bond required, the court may direct a master to make the sale, and, after confirmation, convey the land. Section 91-7-207, MCA. An early case held that failure to give the bond voids the sale. Buckner v. Wood, 45 Miss. 57 (1871).
• Your fiduciary is obligated to increase the ward’s estate, if possible. The courts apply the prudent investor standard, which can be second-guessed. There are a few ultra-safe investments that the fiduciary may make without prior approval, per MCA § 91-13-3, including time CD’s, CDAR’s, savings accounts, and most FDIC- and FSLIC-insured accounts (Note: to my knowledge, credit union accounts do not qualify). Only problem is that in this era, those accounts produce interest rates closer to zero than anything that would actually increase the ward’s estate. So the prudent investor has to look to more speculative investments, which are allowed under MCA 91-13-3 and -5, but require a bond. See In re Guardianship of Roshto, 134 So. 3d 739 (Miss. 2014). Under the GAP Act, you will need to submit your investment plan to the court for approval, with adequate supporting documentation so that anyone looking at it later will be able to see that the court had a valid basis for its order.
• All expenses and receipts must be accounted for annually or more frequently if ordered by the court. UCCR 6.03 – 6.06 detail the voucher requirement. There’s a right way and a wrong way to file an accounting; do it the right way. Forms are published to help you. Use them.
• § 93-13-69, MCA formerly required that accounts of several wards must have been kept separately. We still think that the best practice under the GAP Act will be to open a separate guardianship or conservatorship, or guardianship/conservatorship for each of several wards, even if they are guardianships only, because if assets come into the child’s estate, they must be accounted for separately. The former statute did authorize the judgments dealing with them to be combined “wherever practicable.”

Minor’s settlements …

• Yes, there is nothing in the GAP Act that does away with the requirement of minor’s settlements. § 93-20-431 does allow transfers not exceeding $25,000 to a minor in a given year without court approval, which is commensurate with the law pre-January 1, 2020. So when, exactly, is court approval required? In every transaction in which the minor is to receive a liquidated sum over $25,000, and in every case involving an unliquidated sum. A liquidated sum would include, for example, life insurance proceeds or a lump-sum survivor’s benefit for a set amount by contract. If the settlement is for an unliquidated sum, such as for personal injury settlement, the settlement must be found by a chancellor to be in the best interest of the ward; i.e., in a minor’s settlement proceeding. The statute does not specify the liquidated/unliquidated dichotomy spelled out above, but I believe that approach is the best practice and most protective of all parties.• You should always obtain a letter from the Mississippi Division of Medicaid either stating the amount of its lien against the proceeds, or stating that it asserts no lien. Never accept your client’s word that Medicaid has no lien. Failure to protect Medicaid’s lien can subject both you and your client to an action by Medicaid to recover double damages, and your client can lose Medicaid eligibility as well.
• Remember that, in minor’s settlements, only statutory liens are required to be withheld from the minor’s proceeds. Memorial Hospital at Gulfport v. Proulx, 121 So. 3d 222, 224 (Miss. 2013). It is the duty of the parents, not a child, to provide for the child’s medical care; when you ask the court to order that unpaid medical expenses be paid out of the child’s proceeds, you are essentially asking the court to order the child to pay his or her own medical bills. If you do want the child to have to pay for his own medical care, you will have to put on proof that requiring the parents to pay would put an undue financial burden on the family that will impact other children and the parents, and that if the parents are unable to pay and it goes into collection, the ward’s future ability to obtain medical care will be adversely affected. Otherwise, the chancellor will have to assign responsibility for expenses not included in the settlement on the parents.
• Remember, too, that the chancellor is responsible to make sure that the settlement is reasonable. It makes no difference that everyone with responsibility agrees that the settlement is reasonable. It is the chancellor’s duty to make the decision that it is in the child’s best interest.

• My best prognostication is that, although the law will have changed, chancellors will continue to have the same expectations of diligence, responsibility, candor, and honesty in handling of fiduciary matters that they have had under existing law.

The Lawyer’s Duty Until the Order Allowing Withdrawal

October 28, 2019 § Leave a comment

As I mentioned here not long ago, filing a motion to withdraw does not get you out of the case. You are in it until the judge signs an order allowing withdrawal and the order is entered. You can read that post here.

Here is what the MSSC said about it:

We take this occasion to announce to the bench and bar and the state of Mississippi at large that any time an attorney undertakes to represent a client in any court of record in this state that there attaches at that moment a legal, ethical, professional and moral obligation to continue with that representation until such time as he is properly relieved by the court of record before whom he has undertaken to represent a client. This is true regardless of the circumstances under which his representation of that client may be terminated. This withdrawal may be accomplished only by the filing of a motion with the court with proper notice to the client. The attorney may then withdraw upon the entry of a written order by the court granting him leave to withdraw from representation of his client.

Myers v. Miss. State Bar, 480 So. 2d 1080, 1092-93 (Miss. 1985).

So, what if your client fires you? Do you get to simply walk away? No. You must first file a motion to withdraw, set it for hearing, and notice your client; or get your client to join in the motion. If opposing counsel doesn’t object, get her to sign an agreed order. If there is an objection by anyone, bring it on for hearing. Unless and until the judge signs an order letting you withdraw, you are in the case with every ethical and professional duty to your client. In Alexander v. Miss. Bar, 725 So. 2d 828, 831 (Miss. 1998), the court said, “A lawyer who improperly fails to withdraw after being discharged or when withdrawal is otherwise required is, in general, subject to professional discipline and, in litigation matters, to sanctions imposed by the tribunal … .”

What do you do if another attorney enters an appearance on your side of the case and it appears, but is not clear, that your client no longer wants to deal with you? Can you just stop participating? No. Unless and until you go through the procedure above you continue to have every ethical duty to that client.

What if you discover that mandatory withdrawal is required, such as when further representation would result in violation of ethical rules or the law? Can you stop representing the client? No. You must file a motion and obtain an order. Unless and until you do, you continue to have every ethical duty to that client. Alexander, supra.

And keep in mind that even though you may have have disengaged from the client in your mind, you may have to continue representation if the court disapproves your request. “[T]he lawyer may not withdraw when the lawyer holds the stated belief of a significant disproportion between the detrimental effects that would be imposed on the client by the contemplated withdrawal against detrimental effects that would be imposed on the lawyer or others by continuing the representation.” Restatement (Third) of the Law Governing Lawyers, § 32, cmt a.

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The authority cited is from Jackson and Campbell, Professional Responsibility for Mississippi Lawyers (2010), § 7.5.

Reprise: Draftsmanship is Part of Your Job

October 22, 2019 § Leave a comment

Reprise replays posts from the past that you might find useful today.

Say What You Mean and Mean What You Say

January 4, 2016 § 1 Comment

Lee and Leslie Voulters were divorced from each other in 2004 on the sole ground of irreconcilable differences. The divorce judgment incorporated their PSA, which provided that Lee would pay Leslie lump-sum alimony in the sum of $1.08 million at the rate of $10,000 a month until paid in full. He also agreed to maintain a policy of life insurance on his life with a benefit of $1.08 million, with Leslie as beneficiary.

When Leslie filed a contempt action in 2013 charging Lee with missing some lump-sum payments and with failing to provide proof of life insurance, Lee counterclaimed, asking the court to interpret the PSA that the purpose of the life insurance was to protect Lee’s payment of lump-sum alimony, and that the obligation would terminate when the lump-sum alimony was paid in full.

Spoiler alert: There is no provision in the PSA that links the life insurance requirement to the lump-sum-alimony requirement.

Here are the pertinent parts of the agreement:

LUMP SUM ALIMONY/SPOUSAL SUPPORT

Lee shall pay spousal support to Leslie, in the form of lump sum alimony, the total sum of $1,080,000.00, payable in monthly installments of $10,000.00 each for a period of nine years. Such payments for support shall be due and payable by automatic bank transfer from Lee’s checking or other account directly into Leslie’s checking account, commencing on the fifth day of April, 2004, and shall so continue for one hundred and seven consecutive months thereafter. Lee’s obligation to pay such support to Leslie shall be fully vested upon the entry of a Final Judgment of Divorce in this cause, and shall not be modifiable. Lee’s obligation to pay such support shall not terminate upon Leslie’s death or remarriage, nor shall it terminate upon Lee’s death. However, despite the conventional definition of lump sum alimony[,] . . . these payments by Lee to Leslie under this Agreement shall be taxable to Leslie, and deductible by Lee, for state and federal income tax purposes.

LIFE INSURANCE

Lee agrees to maintain life insurance on his own life in an amount not less than one million, eighty thousand dollars ($1,080,000.00), naming Leslie as primary beneficiary thereon. Proof of such insurance coverage shall be furnished to Leslie within fifteen (15) days following the date of execution of this Agreement. Furthermore, Lee shall direct his insurance carrier to provide coverage information to Leslie at least twice a year if requested by Leslie.

. . . .

EFFECT OF AGREEMENT

. . . .

The respective rights and obligations of the parties hereunder are deemed independent and may be enforced independently irrespective of any of the other rights and obligations set forth herein. This Agreement contains the entire understanding of the parties, who hereby acknowledge that there have been and are no representations, warranties, covenants, or understandings other than those expressly set forth herein.

RELEASE AND WAIVER

Subject to the provisions of this Agreement, each party has released and forever discharged . . . his or her heirs, legal representatives, Executors, Administrators, and assigns . . . from all causes of action, claims, right or demands . . . in law or in equity . . . except . . . causes of action for divorce or separation action now pending . . . . Each party releases, waives, and relinquishes any and all rights . . . to share in the estate of the other party upon the latter’s death . . . . (Emphasis added.)

Both parties offered testimony about their intent in negotiating the language into the agreement. Lee argued that the agreement was ambiguous because it had no termination date. Leslie argued that she negotiated it for support, which she needed because her estate was meager in comparison to Lee’s.

One question before I tell you how the chancellor ruled: do you see anywhere in that language quoted above any link between the life insurance obligation and the lump-sum alimony?

The chancellor ruled that the agreement was unambiguous, and that it did require Lee to maintain the life insurance regardless of the status of the lump-sum payments. Lee appealed.

On December 8, 2015, the COA affirmed in Voulters v. Voulters. The opinion by Judge Barnes includes a nice recitation of the law of contract interpretation, life insurance and insurable interests, and even attorneys fees in contempt actions and on appeal.  I definitely commend it to your reading.

What I want to focus on here is this: If you want your agreement to mean a particular thing, then make sure there is language in it that says that particular thing. Remember that when the judge is called on to interpret a contract, she is bound by the language within the four corners of the document, and she may not accept parol evidence to vary or “explain what the parties meant” by those terms unless she first finds the agreement to be ambiguous. Just because Lee did not include a termination date for his life insurance obligation, that did not render the agreement ambiguous. It rendered instead the meaning that it had no termination date. In other words, it meant exactly what it did and did not say.

Be careful in your draftsmanship. Take time to make sure it says exactly what your client needs it to say. I think I was saved a hundred times or more by the simple practice of drafting the agreement and setting it aside for at least a day. I would then pick it up and read it afresh, often catching something that could be read two ways, or was simply not clear enough to do the job. Sometimes I would imagine myself to be another person altogether, looking at it as an outside observer. Anything to get an objective perspective.

Remember that some day someone entirely unconnected with the negotiations and the emotion of the divorce case is going to be reading your work with absolutely none of the knowledge that you had when you drafted it. It may be a judge, or it may be another lawyer having to represent your client, or — heaven forbid — a lawyer looking for a cause of action against you. That’s why it’s critical when you draft an agreement to give some thought and care to the words, phrases, and language construction that you use. That’s what your client is paying you for: to have absolutely no more trouble out of this matter after the final judgment is entered.

Filing A Motion Doesn’t Get You Automatic Relief

October 7, 2019 § 1 Comment

MRCP 7(b)(1) reads, “An application to the court for an order shall be by motion … .” A motion, then is merely a request for the court to enter an order; it’s not the order itself.

Put another way: a motion for continuance does not get you that continuance until the judge enters an order continuing; a motion to withdraw from representation does not get you out of the case until the judge signs an order letting you out.

This is basic stuff, but some lawyers don’t seem to get it.

In one case a couple of months ago a lawyer did not show up for a final hearing. The other attorney advised that he had filed a motion to withdraw the afternoon before, but he did not appear to present it to the court. He also did not provide a paper copy of it to the court as required by the MEC rules since it was within 24 hours of trial. As things developed, though, I doubt that I would have granted his motion because, as became painfully obvious in the course of the hearing, his client had an intellectual disability and struggled to present her side of the case. Struggled mightily. That earned that lawyer a show-cause order.

While I’m on the subject of motions to withdraw, has anybody read UCCR 1.08? Does anybody have a copy of it? Well, here it is in its elegant simplicity and entirety: “When an attorney makes an appearance for any party in an action, the attorney will not be allowed to withdraw as counsel for the party except upon written motion and after reasonable notice to the client and opposing counsel.”

It’s not enough to file the motion and present an agreed order signed by you and your client. It’s not enough to file a motion and present an agreed order signed by you and opposing counsel. As I have often said in chambers, “Give me an agreed order or set it for hearing,” meaning for a motion to withdraw to get your client and opposing counsel to sign off on it or set it for hearing.

I have had lawyers file motions for continuances and then call my staff attorney asking whether they have to show up. We always offer to hear those in chambers before the trial date if the lawyers both are willing to come. Often the reason is that the lawyer has a conflicting setting in another county. My question is: why would you take a case knowing you have a calendar conflict without first calling opposing counsel to see whether she will agree to a continuance? I know, you need the fee. But you are causing everyone a problem, the judge in particular (ok, that’s from my perspective).

More on Costs

August 28, 2019 § Leave a comment

Yesterday we touched on the concept of costs, as distinguished from fees and expenses.

In the case of Hubbard v. Delta Sanitation of Mississippi, 64 So. 3d 547, 559 (Miss. Ct. App. 2011), the COA, by Judge Myers, reversed a trial court’s award of certain expenses as costs in a case. Although it addresses the seldom-used MRCP 68, its rationale applies to other rules involving costs. The opinion includes a scholarly, if somewhat lengthy, exposition on costs that you might find useful if you are briefing or arguing the point and need more authority than mere Advisory Committee Notes:

¶ 45. This is a case of first impression with regard to Rule 68. Because we are asked to interpret Rule 68, we do so de novo. Miss. Transp. Comm’n v. Fires, 693 So.2d 917, 920 (Miss.1997).

¶ 46. There is scant Mississippi case law dealing with Rule 68. The rule is patterned after Federal Rule 68. Harbit v. Harbit, 3 So.3d 156, 162 (¶ 20) (Miss.Ct.App.2009). Mississippi’s version states, in pertinent part, that:

At any time more than fifteen days before the trial begins, a party defending against a claim may serve upon the adverse party an offer to allow judgment to be taken against him for the money or property or to the effect specified in his offer, with costs then accrued…. If the judgment finally obtained by the offeree is not more favorable than the offer, the offeree must pay the cost incurred after the making of the offer.

M.R.C.P. 68.

¶ 47. The purpose of Rule 68, and its federal counterpart, is “to encourage settlements, avoid protracted litigation, and protect the party who is willing to settle from the burden of costs that subsequently come.” Fiddle, Inc. v. Shannon, 834 So.2d 39, 49 (¶ 38) (Miss.2003) (quoting M.R.C.P. 68 cmt.); see also Marek v. Chesny, 473 U.S. 1, 10, 105 S.Ct. 3012, 87 L.Ed.2d 1 (1985) (“[Federal] Rule 68’s policy of encouraging settlements is neutral, favoring neither plaintiffs nor defendants; it expresses a clear policy of favoring settlement of all lawsuits.”).

¶ 48. In Shannon, our supreme court spoke to the operation of the rule. Citing Delta Air Lines, Inc. v. August, 450 U.S. 346, 101 S.Ct. 1146, 67 L.Ed.2d 287 (1981), the Shannon court found that in order to trigger Rule 68’s “cost-shifting procedure[,]” the offeree must obtain a judgment. Shannon, 834 So.2d at 49 (¶ 39). Shannon held that because the defendant was the prevailing party, the trial court did not err in denying the defendant’s Rule 68 motion. Id.; cf. Johnston v. Stinson, 495 So.2d 1023 (Miss.1986) (holding that the trial court erred in requiring the plaintiff-offeree to pay “court cost” under Rule 68 because the plaintiff obtained a judgment more favorable than the defendant’s offer of judgment); see also Poteete v. Capital Eng’g, Inc., 185 F.3d 804, 806 (7th Cir.1999) ( “[Federal] Rule 68 is applicable only to cases the defendant loses.”); La. Power & Light Co. v. Kellstrom, 50 F.3d 319, 333 (5th Cir.1995) (per curiam) (“If a plaintiff takes nothing … [Federal] Rule 68 does not apply.”).

¶ 49. The term “costs” is not defined in our Rule 68 or its federal counterpart. Neither Shannon nor Johnston addressed the meaning of “costs” under the rule. This Court touched on the subject in Harbit, but the issue there was limited to the propriety of attorney’s fees having been awarded as costs in a divorce action.

¶ 50. Harbit held that the chancery court erred when it used Rule 68 to award attorney’s fees as part of costs. Harbit, 3 So.3d at 162 (¶ 20). Relying on federal jurisprudence as persuasive authority, Harbit noted that Marek held “the most reasonable inference” of the meaning of “costs,” in Federal Rule 68, is that the term “was intended to refer to all costs properly awarded under a relevant substantive statute or other authority.” Id. (quoting Marek, 473 U.S. at 9, 105 S.Ct. 3012). Harbit then explained:

We are not aware of any Mississippi statute that authorizes a chancellor to award attorney’s fees, as part of costs, to a prevailing party in a divorce proceeding. While there is plenty of authority authorizing a chancellor, in the chancellor’s discretion, to award attorney’s fees to a party in a divorce action, that authority is decisional law and is based on financial needs of the party. Therefore, we find that the chancellor erred in using Rule 68 to calculate the amount of attorney’s fees awarded….

Id. at (¶ 21) (internal citation omitted).

¶ 51. Federal courts have interpreted “costs” under Federal Rule 68 as referring to those costs ordinarily awarded under Rule 54(d) of the Federal Rules of Civil Procedure. Hedru v. Metro–North Commuter R.R., 433 F.Supp.2d 358, 360 (S.D.N.Y.2006); Thomas v. Caudill, 150 F.R.D. 147, 149 (N.D.Ind.1993) (citing 7 Moore’s Federal Practice § 68.06(3) (3d ed.1997)). In Thomas, the district court opined that the United States Supreme Court indicated in Marek that “the position in Moore’s Federal Practice is the correct definition of ‘costs’ and that the costs which a defendant is entitled to recover under [Federal] Rule 68 are limited to the costs allowable under Federal Rule of Civil Procedure 54(d).” Thomas, 150 F.R.D. at 149. Thomas based its finding on Marek’s comment that “Rule 68 does not come with a definition of costs; rather, it incorporates the definition of costs that otherwise applies to the case.” Id. (quoting Marek, 473 U.S. at 11 n. 2, 105 S.Ct. 3012).

¶ 52. In Delta Air Lines, the Supreme Court indicated that there is an intrinsic link between Federal Rules 68 and 54, stating:

Rule 68 provides an additional inducement to settle in those cases in which there is a strong probability that the plaintiff will obtain a judgment but the amount of recovery is uncertain. Because prevailing plaintiffs presumptively will obtain costs under Rule 54(d), Rule 68 imposes a special burden on the plaintiff to whom a formal settlement offer is made. If a plaintiff rejects a Rule 68 settlement offer, he will lose some of the benefits of victory if his recovery is less than the offer. Because costs are usually assessed against the losing party, liability for costs is a normal incident of defeat.

Delta Air Lines, 450 U.S. at 352, 101 S.Ct. 1146.

¶ 53. In Johnston v. Penrod Drilling Co., 803 F.2d 867 (5th Cir.1986), the Fifth Circuit Court of Appeals, interpreting Delta, also acknowledged the interrelationship between the two rules, and the court noted the following distinction:

Rule 68 is a mandatory rule designed to operate automatically by a comparison of two clearly defined figures. In Delta [,] … the defendant argued that Rule 68 operated to shift the costs to the plaintiff when the defendant’s $450 offer was rejected and defendant later obtained a take nothing judgment. The [Supreme] Court held that Rule 68 did not operate to shift costs because a take nothing judgment was not a “judgment finally obtained by the offeree.” Our interpretation of Rule 68 is consistent with the teaching of Delta: it is a mandatory rule to be narrowly applied. [Federal] Rule 54(d) gives the district court the necessary discretion to tax costs against the party who should equitably bear them. Rule 68, which provides that the plaintiff must pay costs if its conditions are met, is not such a rule.

Penrod Drilling, 803 F.2d at 870–71.

¶ 54. Federal Rule 54(d) states in relevant part: “Unless a federal statute, these rules, or a court order provides otherwise, costs—other than attorney’s fees—should be allowed to the prevailing party.” Rule 54(d) of the Mississippi Rules of Civil Procedure is patterned after former Federal Rule 54(d), and states in part: “Except when express provision therefor is made in a statute, costs shall be allowed as of course to the prevailing party unless the court otherwise directs….”

¶ 55. As with Rule 68, there is little Mississippi case law dealing with our Rule 54(d). The United States Supreme Court spoke to Federal Rule 54(d) in Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 107 S.Ct. 2494, 96 L.Ed.2d 385 (1987), superseded on other grounds, 42 U.S.C. § 1988 (1991). There, the Court addressed “the power of federal courts to require a losing party to pay the compensation of the winner’s expert witnesses.” Id. at 438, 107 S.Ct. 2494.

¶ 56. Crawford held that “when a prevailing party seeks reimbursement for fees paid to its own expert witnesses, a federal court is bound by the limit [ations] [set out] in [28 U.S.C.] § 1821[ ] [and § 1920], absent contract or explicit statutory authority to the contrary.” Id. at 439, 107 S.Ct. 2494. The Supreme Court explained that the term “costs” as used in Rule 54(d) is defined by § 1920, which specifically enumerates expenses that a federal court may tax as costs under that rule. Id. at 441–42, 107 S.Ct. 2494. The Court said, “§ 1821 specifies the amount of the fee that must be tendered to a witness, § 1920 provides that the fee may be taxed as a cost, and [Federal] Rule 54(d) provides that the cost shall be taxed against the losing party unless the court otherwise directs.” Id. at 441, 107 S.Ct. 2494.

¶ 57. Briefly, we note that Federal Rule 54(d) was amended on April 30, 2007, effective December 1, 2007, and the language, “unless the court otherwise directs” was removed. In speaking to former Federal Rule 54(d), the Sixth Circuit Court of Appeals explained that “the discretion that Rule 54(d) gives courts (the ‘unless the court otherwise directs’ proviso) is discretion to decline requests for costs, not discretion to award costs that [28 U.S.C.] § 1920] fails to enumerate.” In re Cardizem CD Antitrust Litig., 481 F.3d 355, 359 (6th Cir.2007) (emphasis added).

¶ 58. In Ezelle v. Bauer Corp., 154 F.R.D. 149, 152 (S.D.Miss.1994), the district court spoke to the operation of Federal Rule 68 in conjunction with Federal Rule 54(d):

The party who prevails in a lawsuit ordinarily recovers costs from the losing opponent pursuant to Rule 54(d) of the Federal Rules of Civil Procedure. However, the award of costs under this Rule is a matter of the court’s discretion, and Rule 54(d) permits the district court, on a showing of good cause, to require a prevailing party to bear its own costs. Delta Airlines [Air Lines][,] 450 U.S. [at] 353–56, 101 S.Ct. 1146…. Therefore, the award of costs is not a merely mechanical event and remains, generally speaking, a matter of a district court’s discretion.

However, the district court may be deprived of its discretion under Rule 54(d) where Rule 68 of the Federal Rules of Civil Procedure properly comes into play. [Penrod Drilling,] 803 F.2d [at] 869[.]

¶ 59. The Eleventh Circuit Court of Appeals applied Crawford’s holding in Parkes v. Hall, 906 F.2d 658, 658 (11th Cir.1990), a personal-injury diversity case, where Federal Rule 68 was invoked. The question in Parkes was whether Federal Rule 68, once triggered, obligated the plaintiff to pay costs in addition to those allowed by statute. Id. at 659. Parkes held that “costs which are subject to the cost-shifting provisions of Rule 68 are those enumerated in 28 U.S.C. § 1920, unless the substantive law applicable to the particular cause of action expands the general § 1920 definition.” Id. at 660; see also Knight v. Snap–On Tools Corp., 3 F.3d 1398, 1404 (10th Cir.1993) (holding same); Phillips v. Bartoo, 161 F.R.D. 352, 354 (N.D.Ill.1995) (“absent substantive law authorizing the expansion of § 1920 provisions, Rule 68 ‘costs’ are limited to the definition in § 1920”).
10 ¶ 60. Mississippi does not have a specific statute comparable to that of § 1920, which enumerates all the expenses a court may tax as costs. Rather, items that may be taxed as costs can be found throughout the Mississippi Code.

¶ 61. Other states with procedural rules similar to ours have concluded that costs under their own respective version of Rule 68 are limited to those costs allowable under their version of Rule 54(d). The Court of Appeals of Indiana, in interpreting the term “costs” under Indiana Trial Rule 68, which is almost identical to our Rule 68, said the following: “ ‘Cost’ is a term of art with a specific legal meaning, and we must presume that it was used consistently absent evidence of a contrary intent by the drafters.” Missi v. CCC Custom Kitchens, Inc., 731 N.E.2d 1037, 1039 (Ind.Ct.App.2000). The Missi court held that there is nothing “on the face of T.R. 68 to indicate that the drafters intended a more expansive definition of ‘costs’ than its traditional meaning as embodied in [Indiana Trial Rule] 54(D)….” Id.7

¶ 62. The Supreme Court of Appeals of West Virginia, in Carper v. Watson, 226 W.Va. 50, 697 S.E.2d 86, 95 (2010), held that:

the “costs” that may be assessed against a plaintiff under West Virginia Rule of Civil Procedure 68(c) include only those expenses defined as “costs” by statute. Typically, costs under Rule 68(c) will be limited to “court costs,” i.e., the costs taxable under West Virginia Rule of Civil Procedure 54(d).

¶ 63. We find the logic and reasoning behind the foregoing interpretations persuasive. There being no express indication in the rules of civil procedure, or controlling case law, to the contrary, this Court must presume that the drafters of Rule 68 intended for the term “costs” to be used consistent with Rule 54(d). Therefore, we hold that the costs for which Delta is entitled to recover under Rule 68 are limited to those costs allowable under Rule 54(d). The operation of Rule 68 in this case simply made it mandatory, rather than discretionary, for the trial court to impose upon Hubbard the costs allowed under Rule 54(d) after Delta made its offer of judgment.

¶ 64. But that does not end our analysis. As with Rule 68, Rule 54(d) does not expressly define what constitutes “costs.” Rather, as previously mentioned, Rule 54(d) states in part: “Except when express provision therefor is made in a statute, costs shall be allowed as of course to the prevailing party unless the court otherwise directs….” Here, there is no underlying, substantive statute with a cost provision contained therein that forms the basis of Hubbard’s case, as it is predicated on common-law negligence. That no such statute governs in this instance means that the trial court was limited to the usual statutory costs. We explain.

¶ 65. Historically, costs were unknown at common law. Alyeska Pipeline Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 247, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975); see also Vincennes Steel Corp. v. Miller, 94 F.2d 347, 348 (5th Cir.1938) (“Costs, as we know them today, were unknown to the common law, and, without the aid of statute, liability therefor rests only upon the party incurring them, as for any other debt.”). Thus, “[c]osts are generally allowable only when authorized by statute or court rule.” 20 C.J.S. Costs § 3 (2007).

¶ 66. In Martin v. McGraw, 249 Miss. 334, 340, 161 So.2d 784, 786 (1964), our supreme court stated that courts of equity have “no inherent jurisdiction to award costs independently of statute.” The supreme court reiterated this principle in Ex parte Ashford, 253 Miss. 768, 179 So.2d 192 (1965). There the court held:

(1) The cost alleged to be due the circuit clerk is cost growing out of many ‘state fail’ cases, but since Mississippi Code Annotated Section 3952(d) (1956) prevents an allowance to the circuit clerk by this Court of a sum in excess of the sum set out in the statute, we cannot allow additional cost over and above the amount set out in the law.

(2) This Court has no implied or inherent power to award cost, and may allow only such cost as the Legislature may expressly permit or direct to be awarded by the Court in acts of the Legislature. Martin v. McGraw, 249 Miss. 334, 161 So.2d 784 [ (1964) ]; 20 C.J.S. Costs § 2 (1940).

Id. at 768–69, 179 So.2d at 192.

¶ 67. In Board of Trustees of Hattiesburg Municipal Separate School District v. Gates, 467 So.2d 216, 218 (Miss.1985), the supreme court held that the transcription costs submitted by a freelance-court reporter, and already prepaid by a school board, were statutorily set and, thus, “limited thereby.” Finding that the court reporter had charged an appearance fee, which the statute made no provision for, the supreme court remanded the matter back to the chancery clerk for retaxation of costs. Id. at 219. In its discussion, the supreme court parenthetically referred to § 1920. See id. at 218 (noting that in the federal courts, “items to be taxed as costs under 28 U.S.C. § 1920 must be within express language of statute”).

¶ 68. In Aeroglide Corp. v. Whitehead, 433 So.2d 952, 952–53 (Miss.1983), due to a mistrial caused by defense counsel’s improper cross-examination, the trial court awarded $14,784.51 to the plaintiffs “for expenses incurred in preparation of trial pursuant to its inherent authority to control the proceedings before it and the conduct of the participants therein.” The Mississippi Supreme Court reversed and remanded the case to the trial court for assessment of the “usual and statutory costs” against the defendants. See id. at 953 n. 2 (acknowledging that the defendants were “liable for the full amount of statutory costs incurred up until the time the mistrial was declared”). Id. The Whitehead court stated:

We agree with the learned trial judge that all courts possess the inherent authority to control the proceedings before them including the conduct of the participants. However, an examination of our holding in Newell v. State, 308 So.2d 71 (Miss.1975) lends no support for the action taken by the trial court in the case sub judice.

Id.

¶ 69. The aforementioned Mississippi cases are very instructive in that their holdings are consistent with the general language found in the comment to Rule 54(d),9 a portion of which states: “costs represents those official expenses, such as court fees, that a court will assess against a litigant.” We now examine the items awarded as costs in this case.

A. Expert Fees

11 ¶ 70. As a general rule, “[f]ees for expert witnesses, beyond the ordinary fees authorized for witnesses …, are not taxable as costs unless there is a statute specifically allowing such an expense.” 20 C.J.S. Costs § 123 (2007). There are a number of Mississippi statutes that allow for expert-witness fees to be taxed as costs in certain cases. None, though, apply in this case.

¶ 71. Rule 706 of the Mississippi Rules of Evidence gives our trial courts general authority to appoint expert witnesses and provide for their compensation. But it is inapplicable because Delta’s expert witness was not court appointed.

¶ 72. What is applicable is Mississippi Code Annotated section 25–7–47 (Rev.2010), one of Mississippi’s fee statutes. Section 25–7–47 is Mississippi’s counterpart to § 1821, the federal statute discussed in Crawford, and it authorizes witness fees. The statute provides that witnesses in the county, circuit, and chancery courts shall receive $1.50 per day in attendance fees and five cents per mile to and from the court. Miss.Code Ann. § 25–7–47.

¶ 73. This being the statutory limit allowed by law, we hold that Hubbard may not be taxed with costs in excess thereof with respect to Delta’s expert witness.

¶ 74. As to Delta’s assertion that Hubbard waived his challenge on this point, it is not well taken. Hubbard’s counsel merely informed the trial court, albeit inaccurately, what he believed the law to be. The law does indeed afford our trial courts some discretion with regard to litigation expenses that a litigant must ordinarily bear. But that discretion is very limited.

¶ 75. The comment to Rule 54(d) states in relevant part: “Absent a special statute or rule, or an exceptional exercise of judicial discretion, such items as attorney’s fees, travel expenditures, and investigatory expenses will not qualify either as statutory fees or reimbursable costs.” This language is congruent with the supreme court’s longstanding view with respect to attorney’s fees and litigation expenses. See Grisham v. Hinton, 490 So.2d 1201, 1205 (Miss.1986) (“With the sole exception of punitive damages cases, in the absence of contractual provision or statutory authority therefor, this Court has never approved awarding trial expenses and attorney’s fees to the successful litigant.”); see also Smith v. Dorsey, 599 So.2d 529, 550 (Miss.1992) (opining that such expenses are analogous to the grant of punitive damages); but see Universal Life Ins. Co. v. Veasley, 610 So.2d 290, 295 (Miss.1992) (where the supreme court carved out a narrow exception to the general rule and held that attorney’s fees “and the like” may be awarded in cases where an insurer wrongly denies a claim even though the party’s conduct does not warrant punitive damages).

¶ 76. In Allred v. Fairchild, 916 So.2d 529, 532–33 (¶¶ 9–12) (Miss. 2005), the supreme court applied the Veasley exception in a breach-of-contract case and upheld an award of accounting fees to the plaintiff because the defendant, who had entered into a confidential business relationship with the plaintiff, had actively engaged in fraud and deceit throughout the parties’ business dealings. Relying on the comment to Rule 54(d), the supreme court said, “[e]xceptional circumstances must exist in order for the court to exercise exceptional judicial discretion” under Rule 54(d). Allred, 916 So.2d at 532 (¶ 10) (indicating that such exceptional circumstances must be shown in the record).

¶ 77. We find no exceptional circumstances, as contemplated by Veasley and Allred, present in this case. Nor do we find that Hubbard waived this point of contention.

B. Copying/Printing Costs, Trial Materials, Court Reporter

¶ 78. We know of no statutory authority or court rule that authorizes these items to be awarded as ordinary costs. The copying expenses sought by Delta in this case are considered office expenses of an attorney and are not recoverable. See, e.g., 20 C.J.S. Costs § 109 (2007). The expenditures made for the demonstrative aids used at trial and the professional technical assistance employed by Delta for help in the courtroom are likewise not recoverable as ordinary costs. See, e.g., 20 C.J.S. Costs § 115 (2007). And with regard to the court reporter fee, the record indicates that it is for the deposition taken of Hubbard’s wife, Denise, prior to trial. Rule 30(h) of the Mississippi Rules of Civil Procedure says: “No part of the expenses of taking depositions, other than serving of subpoenas, shall be adjudged, assessed or taxed as court costs.” Accordingly, this too is not a recoverable cost item.

¶ 79. We point out that Delta relied exclusively on federal case law interpreting the federal counterpart to Rule 68 in support of its argument as to what items may be taxed as costs. As previously indicated, we find the interpretations of those authorities persuasive with respect to the operation of Rule 68. There is no distinction between the mechanics of our Rule 68 and Federal Rule 68; they are the same, Shannon, 834 So.2d at 49 (¶ 39), and the federal courts are well versed with this aspect of the rule.

¶ 80. But such cases offer little assistance for determining the specific items that may be taxed as costs under state law. See, e.g., Carper, 697 S.E.2d at 95 n. 4 (same finding). The federal courts “necessarily base their analysis on … § 1920,” a statute that is not applicable to Mississippi’s law of costs.12 See, e.g., id. (stating that § 1920 is inapplicable to West Virginia’s law of costs).

¶ 81. Even though the Mississippi Supreme Court referenced § 1920 in Gates, it did so merely to illustrate that the federal courts, not unlike Mississippi courts, award costs only permitted by statute. See Gates, 467 So.2d at 218. In no way did the Gates court apply § 1920 to the case.

¶ 82. In Missi, the Indiana case mentioned above, cost items similar to those authorized by § 1920 were awarded by an Indiana trial court apparently because Indiana Trial Rule 68 had been invoked, as the following portion from the Missi court’s opinion illustrates:

In support of their argument that the award of litigation expenses should be affirmed, [the appellees] cite Thomas, wherein the [federal] district court held that the defendant whose offer of judgment had been rejected could recover for photocopy expenses, subpoena and mileage fees, and deposition fees. 150 F.R.D. at 150. The Thomas court relied in part upon Justice Brennan’s dissent in Marek, in which he opined that “ ‘costs’ as that term is used in the Federal Rules should be interpreted uniformly in accordance with the definition of costs set forth in § 1920.” 150 F.R.D. at 148 (citing Marek, 473 U.S. at 18, 105 S.Ct. 3012, … (Brennan, J., dissenting)). [Section] 1920 enumerates among recoverable costs the “[f]ees and disbursements for printing and witnesses,” and “[f]ees for exemplification and copies of papers necessarily obtained for use in the case.”

Missi, 731 N.E.2d. at 1040.

¶ 83. In response, the Missi court explained that Indiana courts “may award costs only when they are expressly authorized by statute.” Id. (quoting Board of County Comm’rs of Vanderburgh County v. Farris, 168 Ind.App. 309, 342 N.E.2d 642, 644 (1976)). The Missi court reiterated that Indiana courts “have no inherent power to assess or award costs to a prevailing party” and stated that “[t]he right to recover costs is a matter left entirely to [Indiana’s] legislature.” Id. (citing Linder v. Ticor Title Ins. Co. of Cal., 647 N.E.2d 37, 40 (Ind.Ct.App.1995)). The Missi court then held that the costs awarded by the trial court were not the sort of costs contemplated by Indiana Trial Rule 54(D) and reversed the trial court’s award of such items. Id.

¶ 84. A similar type argument was made to the Court of Appeals of Tennessee in the case of Person v. Fletcher, 582 S.W.2d 765, 766 (Tenn.Ct.App.1979), where the court was “urged to declare certain items as costs under Rule 68 [of the Tennessee Rules of Civil Procedure,] [because] to hold otherwise Rule 68 will provide no deterrent to the unreasonable prosecution of nuisance value cases.”

¶ 85. Rejecting it, the Person court said:

While Rule 68, T.R.C.P., [i]s patterned after Federal Rule 68, this state has not enacted a law comparable to the federal law found at … § 1920, which expressly empowers the judge or clerk of any court of the United States to tax certain enumerated items as cost. This federal statute is the controlling distinction between Rule 68, T.R.C.P., and the federal rule insofar as what may be included as items of costs.

What constitutes costs is determined from legislative enactment on the subject and this principle is expressed in American Jurisprudence, vol. 20, Costs, [§ ] 52:

Inasmuch as the recovery of costs is dependent on statutory provision, a party who has been adjudged to be entitled to recover or tax costs may include in his bill or memorandum only such items of expense as are taxable by virtue of legislative enactment.

The Supreme Court in the case of [Louisville & N.] Railroad [Co.] v. Boswell, 104 Tenn. 529, 58 S.W. 117 (1900), overruling an effort to include a fee as costs not authorized by statute and quoting its earlier case of Mooneys v. [State], 10 Tenn. 578, [ (1831),] tersely stated: “costs are created by statute; unless there be some law to authorize it, the Court cannot Ex officio give costs against any one.” At common law, costs were not recoverable Eo nomine, 20 C.J.S. Costs [§ ] 2. In the absence of statute expressly designating the claimed items as costs, we hold the costs referred to in Rule 68, T.R.C.P., are those costs authorized by statute as assessed by the trial court in this case.

Id. at 766–67. (emphasis added).

¶ 86. And in Carper, it was argued “that limiting the types of ‘costs’ recoverable under Rule 68(c) to ‘court costs’ undermines the purpose of the rule, because such limitation reduces the economic risk to a plaintiff who refuses an offer of judgment, thereby diminishing the incentive to agree to such offers.” Carper, 697 S.E.2d at 95. The Carper court replied:

While the [a]ppellees’ policy argument may be compelling, this [c]ourt has no authority to sanction the taxation of costs which are not permitted by statute or court rule. Indeed, as previously noted, prohibition will lie against a circuit court that awards costs not specifically allowed by statute or court rule. Consequently, any expansion of the “costs” that may be assessed against a plaintiff pursuant to Rule 68(c) must be left to the [l]egislature or be expanded by this [c]ourt through a new judicial rule.

Id.

¶ 87. We find the holdings in Martin, Ex parte Ashford, Gates, and Whitehead are indicative that the Mississippi Supreme Court’s view on the matter is in line with that held in Missi, Person, and Carper.

¶ 88. Also, we point out that one of the cases relied on by Delta in support of its argument, arguing that we should affirm the trial court’s cost award, involved an action under Title VII of the Civil Rights Act of 1964, which therein contains a provision for attorney’s fees, authorizing courts to award reasonable fees and expenses. See, generally, 42 U.S.C. § 2000e–5(k) (2006). Certainly, when a statute allowing for litigation expenses applies to the case, the types of “costs” awarded will differ significantly compared to a case where a trial court (whether it be a state or federal court) is relegated to the usual statutory costs. Such would have been the circumstances had this case involved, for example, a trespass-to-timber action under section 95–5–10(3) (see n. 10).

¶ 89. Survey of the case law dealing with Rule 68, in general, reveals that litigants often rely on incommensurable cases for support of cost items they contend should be awarded simply because Rule 68 was invoked. See, e.g., Crossman v. Marcoccio, 806 F.2d 329, 331 (1st Cir.1986) (describing Federal Rule 68 as “the most enigmatic of the Federal Rules of Civil Procedure,” partly for this reason). Respectfully, the bench and the bar should keep this in mind.

¶ 90. In conclusion, having found the aforementioned cost items awarded by the trial court to Delta in this case unauthorized by Mississippi law, we must reverse on this issue and remand this case to the trial court for further proceedings consistent with this opinion.

What are Costs?

August 27, 2019 § Leave a comment

What, exactly, are costs within the meaning of the MRCP?

Costs, security for costs, and awards of costs are mentioned in MRCP 3, 4(c)(1), 4(c)(3)(C), 30(h), 41(a)(1), 41(e), 43(f), 53(a), 54, 56(h), 65(c), and 68.

R 54(e) provides that costs are awarded to the prevailing party. The Advisory Committee Note to R 54 includes this helpful guidance:

Three related concepts should be distinguished in considering Rule 54(d): These are costs, fees, and expenses. Costs refer to those charges that one party has incurred and is permitted to have reimbursed by his opponent as part of the judgment in the action. Although costs has an everyday meaning synonymous with expenses, taxable costs under Rule 54(d) is more limited and represents those official expenses, such as court fees, that a court will assess against a litigant. Costs almost always amount to less than a successful litigant’s total expenses in connection with a law suit and their recovery is nearly always awarded to the successful party.

Fees are those amounts paid to the court or one of its officers for particular charges that generally are delineated by statute. Most commonly these include such items as filing fees, clerk’s and sheriff’s charges, and witnesses’ fees. In most instances an award of costs will include reimbursement for the fees paid by the party in whose favor the cost award is made.

Expenses include all the expenditures actually made by a litigant in connection with the action. Both fees and costs are expenses but by no means constitute all of them. Absent a special statute or rule, or an exceptional exercise of judicial discretion, such items as attorney’s fees, travel expenditures, and investigatory expenses will not qualify either as statutory fees or reimbursable costs. These expenses must be borne by the litigants.

That is probably enough to get you through most situations. But if you need a more scholarly analysis with case law, I’ll post one here for you tomorrow.

Late to the Party

July 30, 2019 § Leave a comment

Terrie Singleton and Orlando Buford had a son together. Orlando filed an action in chancery seeking custody of the child. On the day set for hearing Terrie failed to appear, and, based on the undisputed testimony of Orlando and his mother, he was granted custody.

Neither Terrie nor her attorney appeared because the attorney had calendered the case for the wrong date. Later that day the attorney discovered the error and asked for a continuance, which was denied. The attorney then filed a “motion for reconsideration” even before the judgment was entered, followed by a motion for new trial “or reconsideration” seven days after the judgment was entered. The chancellor denied the relief and Terrie appealed.

In Singleton v. Buford the COA reversed and remanded in a decision rendered June 18, 2019. Judge Jack Wilson’s opinion for the majority devoted considerable attention to whether Terrie’s post-trial motion were for R59 or R60 relief, and then turned its attention to whether the chancellor abused his discretion in not granting rehearing:

¶18. On the facts of this case, we cannot avoid the conclusion that the chancery court abused its discretion by denying Singleton’s motion for reconsideration or a new trial. [Fn omitted] A child custody case involves more than just the competing interests of ordinary civil litigants. As this Court has explained,

It passes without citation that, in child custody cases, the paramount consideration is the best interest of the child. . . . Certainly, a more prudent determination of custody may be made when based upon evidence presented from both parents rather than evidence presented by only one. Where a chancellor has the opportunity to consider the argument of both parents, the facts and circumstances affecting his determination are presumably more fully developed. It follows that a chancellor is able to make a more informed decision, thereby ensuring to a higher degree of certainty that the best interest of the child is met.

Wade v. Wade, 967 So. 2d 682, 684 (¶8) (Miss. Ct. App. 2007).

¶19. Wade’s discussion of this issue is sound, and it applies directly to the facts of this case. There was no persuasive reason not to allow Singleton to present evidence and provide the court with additional information relevant to the custody determination. Allowing her to present evidence would have allowed the chancellor “to make a more informed decision, thereby ensuring a higher degree of certainty that the best interest of the child is met.” Id. And on the other side of the balance, the need for “[f]inality of judgments as a policy reason for denial is not nearly so strong” when a motion is filed within ten days of the judgment. Bruce, 587 So. 2d at 904. On these facts, we hold that the chancery court abused its discretion by relying on the “need to achieve finality in litigation” [Fn 7] and by denying Singleton’s motion.

[Fn 7] As noted above, the chancery court relied on Stringfellow v. Stringfellow, 451 So. 2d 219 (Miss. 1984), for this proposition. Stringfellow was a Rule 60(b) case involving issues of alimony and property division, and its facts bear little resemblance to the instant case. In Stringfellow, the chancery court held a hearing on alimony and property division, both sides presented evidence, and the court entered a final judgment. Id. at 220. The exwife later filed a Rule 60(b) motion in which she alleged that her ex-husband committed a fraud on the court, but the Supreme Court found no evidence of that. Id. at 222. The exwife also alleged that her lawyer failed to conduct adequate discovery, but the Supreme Court held that, without more, attorney incompetence “does not give rise to Rule 60(b)(2) relief.” Id.

¶20. We emphasize that a legal determination that a trial judge committed an abuse of discretion “does not ‘imply bad faith or an intentional wrong on the part of the trial judge.’” Sanford v. Dudley, 196 So. 3d 1106, 1112 (¶19) (Miss. Ct. App. 2016) (brackets omitted) (quoting White v. State, 742 So. 2d 1126, 1136 (¶42) (Miss. 1999)). Rather, “an abuse of discretion is viewed as a strict legal term.” Id. (quoting White, 742 So. 2d at 1136 (¶42)). As our Supreme Court has explained,

[J]udicial discretion is not boundless but is defined as a sound judgment which is not exercised arbitrarily, but with regard to what is right and equitable in circumstances and law, and which is directed by the reasoning conscience of the trial judge to just result. An abuse of discretion means clearly against logic and effect of such facts as are presented in support of the application or against the reasonable and probable deductions to be drawn from the facts disclosed upon the hearing.

Douglas v. Burley, 134 So. 3d 692, 697 (¶13) (Miss. 2012) (citations and quotation marks omitted). On the facts of this child custody case, there simply was no “sound” reason for denying Singleton’s motion. As a result, the denial was arbitrary and an abuse of discretion.

Carlton dissented, joined by Barnes and Greenlee. They would have ruled that Singleton failed to meet her burden of proof for relief under R59.

This is one of those haunting scenarios that recur in lawyers’ nightmares. Sometimes, though, there is more to the story than meets the eye on appeal. If the lawyer were habitually late or absent, the judge may have drawn a line. If so, the better practice would have been to include that in the order denying the motion. I’m not saying that was a factor in this particular case, but if it were the judge’s action is more understandable.

To Seal or Not to Seal

July 3, 2019 § Leave a comment

… That is the question. Or was in a recent COA case.

A chancellor had sealed records in a controversial case, and a Jackson-area law firm sought to intervene in the litigation based on its claim that it should have access to certain documents produced in discovery but now kept from it by seal. The chancellor denied the motion to intervene, with the effect that the firm had no basis to access the records, and the law firm appealed.

In Butler Snow and Clark v. Estate of Mayfield, et al., the COA ruled that the chancellor improperly sealed the records.

¶25. “Mississippi law favors public access to public records . . . .” Estate of Cole v. Ferrell, 163 So. 3d 921, 925 (¶18) (Miss. 2012). “Court filings are considered to be public records, unless otherwise exempted by statute.” Id. at (¶15). “The law allows courts to determine when information should be declared confidential or privileged, exempting it from the Public Records Act.” Id. at 929 (¶33).

¶26. As Estate of Cole explains, the Legislature actually requires sealing certain types of records, such as certain youth court records, or confidential financial information. Id. at 924 (¶10). In general, “parties may request that the trial court seal certain documents,” at which point “the trial court may, in its discretion, limit the public’s access to those records.” Id. That discretion in sealing likewise provides us with a deferential standard of review, for in “determining whether the action taken by the court is proper, we review for an abuse of discretion.” Id. at (¶11).

¶27. In analyzing whether to seal a record, the Supreme Court explained that a trial court must “balanc[e] the parties’ competing interests—the public’s right of access versus confidentiality.” Id.; accord Miss. Dep’t of Corr. v. The Roderick & Solange MacArthur Justice Ctr., 220 So. 3d 929, 951 (¶78) (Miss. 2017) (noting the balancing test to weigh the public right of access against the private desire to seal the record from review).

¶28. Recently, the Supreme Court was faced with a sealed divorce file that contained serious allegations of the sexual abuse of underage children. Smith v. Doe, 2016-CA-00875-SCT, 2018 WL 549404 (Miss. Jan. 25, 2018). “Given the allegations raised and evidence presented in this appeal, th[e] Court ha[d] significant public health and safety concerns.” Id. at *5 (¶27). It “therefore remand[ed] the chancellor’s order sealing the court file for the trial court to conduct the balancing test set out in Estate of Cole . . . and determine whether the court file should remain under seal.” Id.

¶29. In this case, there is no indication the chancery court conducted the balancing test in any fashion. The only request to the chancery court was from Mayfield’s family to seal the matter to shield against all public scrutiny. During oral argument, counsel for Mayfield’s family admitted that any need for sealing the record was lessened by the pendency of the federal suit, which injected the allegations back into the public sphere. Despite this admission, the Mayfield family has actively used the seal as a shield against discovery in the federal litigation, to conceal what information it obtained pursuant to the bill of discovery.

¶30. Our review of the record shows that it does not contain confidential information, or indeed any information, that warrants a seal; as set out above, no balancing test was performed prior to sealing. The three-volume record before us primarily contains notices of subpoenas issued, depositions taken, and various other pretrial matters. The record does not contain the responses to the subpoenas duces tecum, deposition transcripts, or other documents obtained in discovery. We therefore reverse and render, unsealing the trial court record. We take no position on whether the information gained in the suit below is discoverable in the federal action, since that will be determined by the magistrate and district court in that pending action.

Lesson here is that the record must reflect that the chancellor conducted the proper balancing test. If you feel that there is an appeal in your case’s future, it would behoove you and your client to ensure that the judge does so and that it is in the record. If you don’t, you might have to explain to your client why the case is headed back to the trial court for a do-over. Clients hate to pay for a do-over, especially one that their lawyer could have avoided.

Oh, and a related point; when the record is sealed in MEC, everybody — and that includes you — is barred from reading anything in the file. Some lawyers came to me and asked me to seal a file, and I did because every attorney in the case agreed. They then discovered to their chagrin that none of the attorneys was receiving copies of pleadings filed and orders entered. They soon scrambled back and urged me to unseal the file, which I did. Better to ask that a particular document be sealed.

Most sealing takes place in domestic cases by agreement. If you don’t have an agreed order, it’s best either to forego sealing or set the matter for hearing and ask the judge to conduct an Estate of Cole balancing test on the record.

A Valuable Resource is Coming Your Way

May 31, 2019 § Leave a comment

Chancery judges have long had a resource not available to practitioners: The Benchbook for Mississippi Chancery Court Judges.

The last printed edition I have consists of 31 chapters on topics ranging from divorce, alimony, probate, property, restraining orders and injunctions, recusal, and everything in between. There are case citations, tables of authority, statutes, and other helpful material. It is updated periodically by the Mississippi Judicial College’s (MJC’s) excellent staff attorneys.

In the past few years the Benchbook has been accessible behind a password-wall at MJC’s web site, rather than in printed form.

The good news for you is that, effective July 1, 2019, the password will no longer be required, and attorneys and others will be able to access this valuable resource. You will have at your fingertips some of the best research you could hope for ready to use in any chancery proceeding.

You will find the Benchbook at the MJC web site under the ‘Publications” tab, or at this link.

PS … there are benchbooks for circuit and county court judges, and even for justice court judges.

 

Five Rookie Faux Pas

April 22, 2019 § 2 Comments

Aside from the fact that much of their attire is shiny new, and their shoes are not (yet) run down and scuffed up, it’s usually easy to spot rookie attorneys by the vexation they spread around them like pixie dust as they make their wake through a hearing. Here are five of the most vexatious:

The Leading Objection.

Attorney 1:  Were you living with your wife when you moved to Kosciusko?

Attorney 2:  Objection; leading.

Now, what did we accomplish in that exchange other than to impress on some observers that Attorney 2 knows the difference between a leading and a non-leading question? Well, one thing it accomplished was to break up the flow of the hearing, which is self-defeating. Another thing it accomplished is to pi$$ off the other attorney, who is likely to retaliate when Attorney 2 goes on direct, which in turn pi$$e$ off the judge who is straining to discern some substance amid this frivolity.

Maybe there is a case out there in which the appellate court reversed because the judge allowed a leading question. If so, it was certainly a jury trial and not a chancery bench trial. But I am not aware of any such case, so keep in mind that your objection is accomplishing nothing to protect your record.

My suggestion is that you save your leading objections for when the other side is drawing blood, like this:

Attorney 1:  Isn’t it true that you could not have possibly admitted to your neighbor your adultery because you weren’t there that day?

Now that’s rightly objectionable, and should by all means draw an objection, which should be sustained. Why? Because it’s really the lawyer testifying, and it goes to the substance of the case.

Moral of the story: Save leading objections to protect your case. Don’t cheapen the objection by whipping it out every time you hear a leading question. We all know that you know what’s leading and what’s not; you don’t need to convince us.

Pleadings are NOT Evidence.

If you want the trial judge to consider a document or the testimony of a witness, you must get that document or oral testimony admitted into evidence. Exhibits to the pleadings and the pleadings themselves are NOT in evidence. They will not be used by the the judge as a basis for her ruling in your case unless and until they are in evidence.

Getting things into evidence does require a command of the rules of evidence. Study them. Know them. Click on the Categories button over there on the right and select “Evidence.” There are all sorts of posts about how to get business records, photos, hearsay, and the kitchen sink into evidence. Know how to do it, and how to authenticate. These are survival tools. You will die in the desert wasteland of litigation without a canteen full of evidence knowledge.

And equally important, keep in mind that only what is in evidence can be considered by the appellate courts (with the exception of offers of proof and documents marked for identification; look those up).

Moral of the story: Get proficient in evidence. It’s to a lawyer what human anatomy is to a doctor. And, if you are one of those characters who managed to be birthed out of the law-school womb into the legal world without having taken evidence, please have the common decency to forewarn your chancellor.

You Can NOT Question a Witness About the Substance of a Document that is not in Evidence.

There are all kinds of legitimate reasons why this is so. The mainmost being that we have no idea whether the information in it is admissible at all. Is it hearsay? Is it authentic? We have no way of knowing unless you lay the proper foundation.

This is a common rookie mistake. It usually draws an objection. When the opposing lawyer is slumbering or inexperienced or merely incompetent and fails to object, I sometimes will stop the questioning lawyer and “gently encourage” him to get the document into evidence before questioning the witness about it. That’s because I don’t want to hear a bunch of inadmissible twaddle that I will have to shake out of my head later when I am writing my opinion.

Are you confused about how to get that document into evidence? Well, not meaning to brag, but there is a helpful post at this link on how to get a document into evidence, step by step.

Moral of the story: Follow the process, step-by-step, to get that document into evidence. If it’s one that you anticipate will draw objections, be prepared to meet them by studying the applicable rules in advance. I am sometimes brought near to grateful tears when I see a lawyer in action who has actually studied the rules.

And Don’t Forget to Offer the Document into Evidence.

It happens from time to time. The lawyer lays the document before the witness, has him identify it, and then launches off into some more breathtaking realm of inquiry. After an hour or so of exhilarating rabbit hunting, the young Perry Mason confidently slaps his sheaf of notes down on the table and proclaims, “Tender the witness.” The document is still sitting there before the witness, unadmitted into evidence. Pity. It might have made the difference in the case.

Moral of the story: All those preliminary, foundational steps to admission are for naught if you don’t ask the court to admit the document into evidence.

Object When You Have to!

Don’t take my caveat above against leading objections to mean that you should never object or that you should curtail your objections. Object when it makes a difference.

Let me repeat that more loudly: OBJECT WHEN IT MAKES A DIFFERENCE!

I have seen lawyers sit there and let the other side get rank hearsay in. I have seen documents full of hearsay and other objectionable material pass through with a nod and “no objection.” If it’s hearsay, object. If the document is unauthenticated, object. If it’s completely irrelevant, object. And so on.

One baffling non-objection I have seen lately is to the question, “How many times have you been arrested?” Look at MRE 609. Arrests don’t mean anything. Anyone can be arrested for anything. I can have you arrested for practically nothing (okay, I will have to file a false affidavit, which will get me kicked off the bench, which I won’t do, but there are plenty of people who do file false affidavits out of revenge, or spite, or for no good reason at all). It’s the conviction that counts, and there are limitations on that. Read the rule.

The judge is not a mushroom to be buried in excrement from which wisdom is expected to sprout.

Morel of the story: Object when it makes a difference, and you will be more effective and make a more effective case. BTW … a little fungus humor never hurt anyone.

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